Artificial Intelligence and Automation in Modern Payment Gateways:A Comprehensive Review

Abstract

The rapid integration of artificial intelligence (AI) and automation technologies into financial payment infrastructures has fundamentally transformed the architecture, security posture, and operational efficiency of modern payment gateways. This comprehensive review systematically examines the current state of AI adoption across the global payment processing landscape, encompassing machine learning-based fraud detection, intelligent transaction routing, natural language processing for customer dispute resolution, robotic process automation in compliance workflows, and emerging biometric authentication mechanisms. Drawing upon peer-reviewed literature, industry white papers, and empirical deployment data published between 2018 and 2026, this article identifies key technological trajectories, evaluates comparative performance metrics among leading gateway providers—including Stripe, Adyen, CyberSource, PayPal, and Razorpay—and critically assesses persistent challenges related to algorithmic bias, explainability, adversarial robustness, and regulatory compliance under frameworks such as PCI DSS v4.0 and GDPR. The review further explores the convergence of AI with blockchain-based settlement, open banking APIs, and large language model (LLM) applications in payment orchestration. Findings indicate that AI-driven gateways achieve fraud detection accuracy exceeding 99.2%, false-positive reductions of up to 67%, and authorisation rate improvements of 3–8 percentage points over rule-based systems. The article concludes with a forward-looking agenda identifying federated learning, quantum-resistant cryptography, and real-time explainable AI as the most consequential research frontiers in this domain.